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Buying into weakness on DAX as trend channel forms

DAX Xetra (cash index)

A recovery on the DAX continues to progress this morning as another positive candle completed to open further gains.

The move to close above the old June/August lows around 12,100/12,120 with improving momentum and suggests the bulls are now in full flow.

An intraday slip to 12,064 was decisively bought into yesterday to leave a decisive bull candle yesterday and another positive open today simply adds to the increased confidence that the outlook is increasingly one to buy into weakness.

There is upside potential on momentum, with the MACD bull cross, Stochastics rising decisively and RSI only in the mid-40s when previous bull runs have hit 55/60.

  • The next resistance to really hit comes between 12,300/12,400.
  • Furthermore the market has now left a near term higher low at 12,040 (which was Monday’s low).

On the hourly chart the momentum is strongly configured now with the hourly Stochastics positively positioned, RSI finding buying support around 50 and MACD lines positive.

  • There is a mini uptrend channel also forming now, which comes in this morning at 12,075 meaning that buying into weakness is on, with 12,130 an initial pivot support to look for opportunities.


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At Hantec Markets Ltd we provide an execution only service. Any opinions expressed by analyst Richard Perry should not be construed as investment advice or an investment recommendation. This report does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. Forex and CFDs are leveraged products which can result in losses greater than your initial deposit. Therefore you should only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved, seeking independent advice if necessary prior to entering into such transactions.